In: Finance
Calculate the requested measures for bonds A and B (assume each bond pays interest Semi-Annually:
Bond A: Coupon: 8%, YTM: 8%, Maturity (in years): 2, Par: 100.00, Price:100.000
Bond B: Coupon: 9%, YTM: 8%, Maturity (in years): 5, Par: 100.00, Price:104.055
A.) Calculate the duration for the two bonds by changing the yield up and down 25 basis points
B.) Calculate the duration for the two bonds by changing the yield up and down 10 basis points.
C.) Compare Your answers to parts (a) and (b).